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PESTN
Factors
To determine
how it will conduct business, a company must understand the world
in which it operates. It does this through analysis of PESTN factors
- Political, Economic, Social, Technological, and Natural factors.
All companies should do two PESTN analyses: One looks at your nation
or continent, or even larger geographical areas; the other looks
more specifically at the region in which you will be operating.
- Look at political
factors like the political stability in regions where you
do business; regulations and laws that might affect your business;
taxation regimes; labour policies; a government's view of your
industry and lobby/pressure groups active in your regions.
- Economic
factors include the current state of the economy and economic
trends, extra-regional economies, interest and exchange rates,
inflation, labour costs, etc.
- Social
factors include consumer attitudes and opinions, religious and
cultural considerations, gender issues, important media topics,
brands, pop culture, and demographics.
- Technological
factors are ever-increasing in today's business environment, and
include considerations such as the cost benefits of different
technologies, innovation, patents, research and development, technology
laws, dependent technologies, etc.
- Natural
factors are a growing concern for many businesses, and have been
added to the traditional PEST analysis to reflect the fact that
they are a vital component of the business environment. Natural
factors include ecological issues, sustainability, externalities,
laws regulating pollution, the availability of natural resources,
and other issues related to the global environment.
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